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CFTC monthly November data show a further 4% decline in client assets held by US forex brokers.

(Over-) regulation continues to take its toll in the US retail FX business. CFTC’s just-released November data showed continued erosion of assets held by US retail FX traders at their brokers. This wasn’t a case of clients migrating from one broker to another. Virtually all US retail FX brokers lost client funds in November in the 3%-7% range, save for tiny RJ O’Brien, as shown in the chart below.

At about $608 million, US retail FX client assets are now down 7% from where they were at the beginning of the year, and 18% from start of 2012 levels. And this in a year where globally the forex industry had a very nice comeback in trading volumes — our Retail FX Volume Index shows that global volumes in 2013 were more than 20% above 2012.

2013 has also seen a decline in choice facing US traders, with two known brokers — FX Solutions and Alpari US — withdrawing from the US market. FXCM acquired Alpari’s US clients, while Gain Capital picked up FX Solutions’ US business, the US arm of UK spreadbetting firm City Index.

For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.

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